TF, 05.18.2026, 9C_38/2026
Facts
Following audits conducted by the Federal Tax Administration (FTA) regarding VAT and withholding tax, which revealed the recording of numerous private expenses of the majority shareholder, the Vaud Cantonal Tax Administration (the Tax Administration) initiated tax reassessment and tax evasion proceedings against A. SA for the periods 2006 to 2016. (Facts A.c, A.d)
On December 15, 2022, the Tax Administration issued tax reassessment decisions (for 2008-2013) and final tax assessments (for 2014-2016), claiming additional taxes of CHF 93,253.50 (federal direct tax) and CHF 116,127.05 (cantonal and communal tax), as well as fines for tax evasion. Following a partially upheld objection (notably regarding the statute of limitations for the years 2008-2009), the additional taxes were reduced to CHF 76,670 (federal direct tax) and CHF 96,668.95 (cantonal and communal tax). (Facts A.e, A.f)
The company appealed to the Vaud Cantonal Court. The court partially upheld the appeal regarding the tax reassessment and taxation, essentially confirming the adjustments made by the Tax Administration, and remanded the case to the latter for a new decision and recalculation. A. SA filed an appeal in public law matters with the Federal Supreme Court, challenging the validity of these adjustments. (Facts B.b, C)
Law
The Federal Supreme Court reiterates the legal principles applicable to the dispute. First, it examines ex officio the issue of the statute of limitations for the right to initiate a tax reassessment. Pursuant toArt. 152 para. 3 DBTA andArt. 53 para. 2 and 3 HTA (incorporated byArt. 208 para. 3 LI-VD), this right expires absolutely fifteen years after the end of the relevant tax period. (consid. 4.1, 4.2)
Second, the right to be heard, guaranteed byArt. 29 para. 2 Const., includes the right to produce relevant evidence and to have it considered. Regarding the assessment of evidence, arbitrariness (Art. 9 Const.) is only found if the authority ignores a decisive piece of evidence without serious reason, misinterprets its meaning or scope, or draws unsustainable conclusions. The right to be heard also includes the right of access to the file (Art. 114 DBTA, Art. 41 HTA). If a document is confidential, the authority must at a minimum communicate its essential content to the party concerned so that they may state their position. A claim of violation of the right to be heard must be raised without delay, under penalty of foreclosure. (consid. 5.3, 6.2, 6.3.2)
Third, according to established case law, the tax authority for direct taxes (federal and cantonal/communal) is not bound by the findings or assessments of authorities responsible for indirect taxes, such as VAT or withholding tax. Each procedure is independent, and the direct tax authority must conduct its own investigation and form its own conviction. The principle of protection of good faith cannot therefore be invoked to demand harmonization of decisions. (consid. 7.3.1)
Finally, expenses that are not commercially justified constitute hidden profit distributions (taxable benefits in kind) and must be added back to the company's taxable profit, pursuant to Art. 58 para. 1 let. b DBTA and Art. 94 para. 1 let. b LI-VD. (Consid. 8.2)
Application to the specific case
The Federal Supreme Court examines the statute of limitations ex officio. The right to initiate a tax back-payment for the 2010 tax period expired on December 31, 2025. As the judgment is rendered in 2026, the statute of limitations expired during the federal proceedings. The appeal must therefore be upheld on this point for the federal and cantonal/communal taxes for the year 2010. (Consid. 4.2)
Regarding the assessment of evidence related to "client outings," the Federal Supreme Court finds that the Cantonal Court's analysis is not arbitrary. The cantonal judges were able, without acting arbitrarily, to consider that the certificates produced were too general, established long after the events, and that the testimonies came from individuals with friendly ties to the shareholder, which reduced their probative value. Likewise, the lack of a clear correlation between these expenses and the trend in turnover was noted in a sustainable manner by the previous instance. (Consid. 5.4, 5.5, 5.6)
Regarding the violation of the right to be heard linked to the use of statements by B. (director of company E.) from a VAT audit, the Federal Supreme Court rejects the claim. On one hand, the appellant never raised this point before the cantonal instance, which makes the claim inadmissible. On the other hand, the Cantonal Court correctly set out the essential content of these confidential statements, allowing the appellant to state their position, which they failed to do. (Consid. 6.3.1, 6.3.2)
The claim based on the violation of the principle of good faith, due to the discrepancy between the tax adjustments by the Tax Administration and those of the Federal Tax Administration (withholding tax), is also dismissed. The Federal Supreme Court confirms that the direct tax authority was not bound by the assessment of the Federal Tax Administration and was required to conduct its own investigation, which it did. The argument of a lack of "consistency" is therefore legally unfounded. (consid. 7.3.2)
Finally, the adjustment related to parking space rental fees is confirmed. The Cantonal Court ruled in a non-arbitrary manner that the rental of parking spaces near the shareholder's home, far from the company's premises, and in insufficient numbers for the alleged needs, did not meet a commercially justified purpose but constituted a taxable benefit in kind. (consid. 8.2, 8.3)
Outcome
The Federal Supreme Court partially upholds the appeal. It annuls the cantonal judgment insofar as it concerns the 2010 tax period, noting that the right to initiate a tax back-payment for federal and cantonal/communal taxes for that year is time-barred. The corresponding tax back-payments are canceled.
For the remainder, the appeal is dismissed, and the adjustments for the 2011 to 2016 tax periods are confirmed in principle. Court costs are partially charged to the appellant, who is awarded reduced costs to be paid by the Federal Supreme Court, as the partial upholding of the appeal resulted from the statute of limitations expiring during the proceedings. (dispositif 1, 2, 3, 4)
Silex tax newsletter published in collaboration with Anna Vladau, Attorney at Law
